Judge Mary H. Strobel, Case 19STCV07272 2022-12-08 Tentative Ruling

Hon. Mary H. Strobel

The clerk for Department 82 may be reached at (213) 893-0530.

In this writ action, Plaintiffs and Petitioners Stephen Dreher and Melinda Dreher (“Petitioners”) contend that Defendant and Respondent City of Los Angeles Department of Water and Power (“Respondent” or “LADWP”), a municipal water and power utility that is a department of the City of Los Angeles (“City”), failed to comply with mandatory duties in Article XIIID of the California Constitution when it set new water rates in 2016.

The court held hearings on the writ petition in December 2021 and January 2022. On March 29, 2022, the court issued its decision on submitted matter. As relevant to this remedies phase of trial, the court found that Respondent did not prove that the Low-Income Subsidy Adjustment (“LISA”) charge applied to its water rates complies with Article XIIID, section 6 of the California Constitution. The court denied the petition for writ of mandate in all other respects. The court’s March 29, 2022, decision (“Decision”) includes a detailed summary of the case and the court’s reasoning, which is not repeated here but is incorporated by reference.

The parties agreed to mediate the question of remedies and attended two full day mediation sessions before the Hon. Charles (Tim) W. McCoy, Jr. (Ret.) on July 25, 2022, and August 12, 2022. The parties were unable to reach agreement. Accordingly, the court set a hearing the remedies phase of trial and set a briefing schedule. The court has received Respondent’s opening brief on remedies, Petitioners’ opposition brief and corrected opposition brief, Respondent’s reply, Petitioners’ sur-reply, Respondent’s objections to the sur-reply, and Petitioners’ response to the objections.

Respondent’s Request for Judicial Notice (“RJN”) Exhibits 1-5 – Granted.

Respondent objects that Petitioners submitted new evidence with the sur-reply, and that the sur-reply exceeds the 10-page limit that applies to reply briefs. Respondent moves to strike the new evidence and portions of the sur-reply. In the stipulation signed by the court on September 28, 2022, the court authorized Petitioners to file a sur-reply. The stipulation did not prohibit the parties from filing evidence with the reply or sur-reply. The stipulation did not set any page limits, but the Local Rules incorporate the California Rules of Court for briefing for a petition for writ of mandate. (See Local Rule 3.231(i).) Petitioners’ counsel should have limited the sur-reply to the 10 pages authorized by the Local Rules and California Rule of Court 3.1113(d) for a reply brief. Contrary to Petitioners’ assertion, these rules clearly apply in writ of mandate actions in Los Angeles Superior Court, including for this hearing on remedies.

The evidence submitted with the sur-reply is Respondent’s discovery responses, which were served November 22, 2022, one day after the due date for Petitioners’ opposition. Thus, such evidence could not have been submitted with the opposition brief. Respondent contends that Petitioners are at fault for serving their discovery on October 21, 2022, so that the responses were due November 22, 2022. (Whatley Decl. ¶ 4.) Respondent does not show that the discovery was untimely served pursuant to any discovery statute or rule. Respondent’s discovery responses are relevant to the court’s interpretation of Health & Safety Code section 5472, and Respondent is not prejudiced because it produced the discovery responses and can respond at the hearing. While Petitioners’ counsel should have requested leave of court to file an extra-sized sur-reply, Respondent also does not show prejudice from the additional briefing in the sur-reply. The court, in its discretion, will consider the entire sur-reply and the evidence submitted with it.

Alternatively, Respondent requests leave to file a five-page supplemental brief. Respondent’s counsel may address Petitioners’ sur-reply and evidence at the hearing. Especially since the sur-reply evidence should be familiar to Respondent’s counsel, the court presently finds no good cause for further written briefing. The court notes that four lengthy legal briefs have been considered for this remedies phase and that the court would reach the same result in its ruling even without the sur-reply evidence.

Respondent’s objections to the sur-reply are OVERRULED and its motion to strike is DENIED.

Petitioners seek traditional mandamus pursuant to CCP section 1085. There are two essential requirements to the issuance of an ordinary writ of mandate under Code of Civil Procedure section 1085: (1) a clear, present, and ministerial duty on the part of the respondent, and (2) a clear, present, and beneficial right on the part of the petitioner to the performance of that duty. (California Ass’n for Health Services at Home v. Department of Health Services (2007) 148 Cal.App.4th 696, 704.)

Under Prop. 218, the government bears the burden of proof: “In any legal action contesting the validity of a fee or charge, the burden shall be on the agency to demonstrate compliance with this article.” (Cal. Const., art. XIII D, 6, subd. (b).)

“‘On questions of law arising in mandate proceedings, [the court] exercise[s] independent judgment.’” (Christensen v. Lightbourne (2017) 15 Cal.App.5th 1239, 1251.) The interpretation of statute or regulation is a question of law. (See State Farm Mut. Auto. Ins. Co. v. Quackenbush (1999) 77 Cal.App.4th 65, 77.)

Respondent contends that Health and Safety Code section 5472’s payment under protest requirements apply to the LISA charge and bar any class-wide monetary relief. (Opening Brief (“OB”) 6-14.) Respondent contends that “[t]o invoke section 5472, a public agency need demonstrate just three things: (1) it is an ‘entity’ as section 5470 defines the term; (2) its rates are in one of the categories section 5471 addresses; and (3) its board adopted the rates by at least a two-thirds majority.” (OB 8.) It appears undisputed that Petitioners and the putative class members did not pay the LISA charge under protest, within the meaning of section 5472. However, for reasons discussed below, the court does not find the section 5472 precludes refund of the LISA charge.

“The rules governing statutory construction are well settled. We begin with the fundamental premise that the objective of statutory interpretation is to ascertain and effectuate legislative intent. [Citations.] To determine legislative intent, we turn first to the words of the statute, giving them their usual and ordinary meaning. [Citations.] When the language of a statute is clear, we need go no further. However, when the language is susceptible of more than one reasonable interpretation, we look to a variety of extrinsic aids, including the ostensible objects to be achieved, the evils to be remedied, the legislative history, public policy, contemporaneous administrative construction, and the statutory scheme of which the statute is a part.” (Nolan v. City of Anaheim (2004) 33 Cal.4th 335, 340.)

When interpreting a statute, the court must construe the statute, if possible to achieve harmony among its parts. (People v. Hull (1991) 1 Cal. 4th 266, 272.) “When interpreting statutory language, we may neither insert language which has been omitted nor ignore language which has been inserted.” (See People v. National Auto. and Cas. Ins. Co. (2002) 98 Cal.App.4th 277, 282.) The court “must select the construction that comports most closely with the apparent intent of the Legislature, with a view to promoting rather than defeating the general purpose of the statute, and avoid an interpretation that would lead to absurd consequences.” (People v. Jenkins (1995) 10 Cal.4th 234, 246.)

The pay under protest requirement of section 5472 is found in Article 4 of the Health and Safety Code, titled “Sanitation and Sewerage Systems.” Article 4 is part of Division 5, titled “Sanitation.”

Section 5472 establishes a pay under protest requirement for the fees, rates, tolls, rentals, or other charges fixed pursuant to section 5471. It provides as follows:

After fees, rates, tolls, rentals or other charges are fixed pursuant to this article, any person may pay such fees, rates, tolls, rentals or other charges under protest and bring an action against the city or city and county in the superior court to recover any money which the legislative body refuses to refund. Payments made and actions brought under this section, shall be made and brought in the manner provided for payment of taxes under protest and actions for refund thereof in Article 2, Chapter 5, Part 9, of Division 1 of the Revenue and Taxation Code, insofar as those provisions are applicable.

Section 5471 “gives local public entities the power to both prescribe and collect fees related to sanitation and sewerage.” (Padilla v. City of San Jose (2022) 78 Cal.App.5th 1073, 1079.) Section 5471 states in pertinent part as follows:

a) In addition to the powers granted in the principal act, any entity shall have power, by an ordinance or resolution approved by a two-thirds vote of the members of the legislative body thereof, to prescribe, revise and collect, fees, tolls, rates, rentals, or other charges for services and facilities furnished by it, either within or without its territorial limits, in connection with its water, sanitation, storm drainage, or sewerage system.

(b) In addition to the powers granted in the principal act, any entity shall have power, pursuant to the notice, protest, and hearing procedures in Section 53753 of the Government Code, to prescribe, revise, and collect water, sewer, or water and sewer standby or immediate availability charges for services and facilities furnished by it, either within or without its territorial limits, in connection with its water, sanitation, storm drainage, or sewerage system.

As a preliminary matter, the pay under protest provisions of section 5472 only apply to charges fixed “pursuant to this article,” i.e. Article 4 of the Health and Safety Code, titled “Sanitation and Sewerage Systems.” While on its face section 5471(a) appears to be a grant of authority for an entity to prescribe rates for services furnished by it “in connection with its water … system” other parts of the statute and its legislative history create some ambiguity whether the statute is intended to apply to water sevice fees.

Section 5470 provides relevant definitions. In relevant part, it provides as follows:

The following words wherever used in this article shall be construed as defined in this section, unless from the context a different meaning is intended, or unless a different meaning is specifically defined and more particularly directed to the use of such words:

(e) Entity. “Entity” means and includes counties, cities and counties, cities, sanitary districts, county sanitation districts, county service areas, sewer maintenance districts, and other public corporations and districts authorized to acquire, construct, maintain and operate sanitary sewers and sewerage systems.

(f) Rates or Charges. “Rates or charges” shall mean fees, tolls, rates, rentals, or other charges for services and facilities furnished by an entity in connection with its sanitation or sewerage systems, including garbage and refuse collection.

Thus the definition of “rates or charges” specifically relates to services furnished by an entity in connection with sanitary sewers and sewerage systems. Similarly, the definition of entity means those authorized to acquire, construct, maintain or operate sanitary sewers and sewerage systems.

Application of these definitions to the imposition of the LISA charge is problematic. Respondent presents no evidence the LISA charge is imposed in connection with operation of a sanitary sewer or sewerage system. Nor it is clear that DWP is an entity as defined. There is no evidence DWP is authorized to construct or maintain a sewerage system. With the sur-reply, Petitioners submit discovery responses of Respondent, in which Respondent stated that it could not respond to certain interrogatories and requests for admission because it has no authority, responsibility, or knowledge respecting sanitation charges and the procedures for refund of sanitation charges. (Rottinghaus Decl., Exh. FF [City’s Resp. to Spec. Interrog. Nos. 1, 2, 3, 7, 8]; Exh. DD [City’s Resp. to Req. for Admissions Nos. 1, 3, 11, 13].) Petitioners also cite provisions of the City Charter which suggest that Respondent’s authority is limited to the production and delivery of water and electric power, and that it does not have authority over sewers and sewerage systems. (Id. Exh. HH.)

Respondent argues the City of Los Angeles is an “entity” within the meaning of section 5470(e). However, the respondent in this action is the Los Angeles Department of Water and Power (“LADWP”).

The Statutes are Ambiguous as to Whether Water Delivery Charges Imposed not in Connection with a Sewerage System are Within the Scope of Sections 5470, 5471, and 5472

Respondent contends that section 5472 “applies to the Schedule A Rates,” including the LISA charge. (OB 9-12; Reply 11-4.) The LISA charge recovers the cost of credits provided to low-income and lifeline customers. LISA added $.151/HCF to the tier rates in all tier blocks for SDR customers on Schedule A. (Decision at 6.) The LISA charge is imposed by LADWP in connection with its delivery of water to customers. Accordingly, the LISA charge is a water delivery or service charge. (See Wolstoncroft v. County of Yolo (2021) 68 Cal.App.5th 327, 345.) The issue here is whether section 5472 applies to water delivery charges of a public utility that only provides water and electric service.

The court starts with the definition of “rates or charges” provided by the Legislature, set forth above. That definition strongly suggests that the rates or charges subject to section 5472 must be for “services and facilities furnished by an entity in connection with its sanitation or sewerage systems, including garbage and refuse collection.” (§ 5470(f).)

Respondent argues that “[s]ection 5470’s definitions, then, are tools but not absolute pronouncements of meaning.” Respondent cites to the opening statement in section 5470 that the definitions control “unless from the context a different meaning is intended.” (Reply 11.) As supporting context, Respondent cites to the statement in section 5471(a) that an “entity” may collect fees or charges “in connection with its water, sanitation, storm drainage, or sewerage system.” Respondent interprets this statement very broadly to apply to any fee or charge collected by a public entity in connection with a “water system.”

That section 5472 does not apply to water delivery charges is suggested by the section headings within the Health and Safety Code. Section 5472 is found in Article 4 (entitled “Sanitation and Sewerage Systems”) of Chapter 6 (entitled “General Provisions with Respect to Sewers”) of Division 5 (entitled “Sanitation”) of the Health & Safety Code. As the titles suggest, these Health and Safety Code provisions are concerned with sewers and sanitation, not water delivery service. “[W]hen there is ambiguity, organization and section headings may properly be considered in determining intent and ‘are entitled to considerable weight.’” (Woodland Park Management, LLC v. City of East Palo Alto Rent Stabilization Bd. (2010) 181 Cal.App.4th 915, 923, fn. 5; see also Padilla v. City of San Jose (2022) 78 Cal.App.5th 1073, 1078 [noting that “the article where section 5472 appears (Article 4 of the Health and Safety Code, regulating ‘sanitation and sewerage systems’) applies to garbage collection.”].)

Petitioners cite section 5471(b), quoted above, and contend that the statutory scheme only authorizes water standby charges and not water delivery charges. (Oppo. 16-17.) A “standby” charge is a fee charged “for making water available to property ‘whether the water … services are actually used or not.’” (See Wolstoncroft v. County of Yolo (2021) 68 Cal.App.5th 327, 345.) However, as Respondent points out, if 5471 is only intended to apply to water standby charges (as specified in subdivision (b)) the reference to water charges in subdivision (a) would appear to be redundant.

Given the ambiguity in 5471, the court considers the legislative history as an aid to interpretation.

The Legislative History Undermines Respondent’s Interpretation of Section 5472

Petitioners discuss the legislative history at length and submit a supporting declaration of Anna Maria Bereczky-Anderson, an attorney that specializes in researching the history and intent of legislation. (See Oppo. 13-18; Sur-Reply 9-15.) Petitioners’ evidence of the legislative history of sections 5470-5472 shows the following, in pertinent part.

As originally enacted in 1945 (AB 302), section 5471 authorized charges for services and facilities furnished “in connection with its sanitation or sewerage systems.” (Pet. RJN Exh. H at 41-50.)[1] In 1951, the Legislature added the phrase “water systems” to section 5471 in three places. Before that amendment, the statute permitted “revenues derived” under that section to be used for construction, maintenance, or operation of “sanitation or sewerage facilities.” (Pet RJ N Exh I, J.) The 1951 amendment extended how those revenues could be used by allowing them to also be used for the construction, maintenance, or operation of “water systems.” (Ibid.) Petitioners cite various statements in the legislative history for the 1951 amendments supporting a conclusion that the Legislature’s purpose in adding “water systems and” was to authorize an entity to use revenues from its sewer service charge to pay the costs of its water system. (Pet. RJN Exh. K at 60; Exh. L at 63; Exh. M at 66; Exh. N at 69.)

In 1988, by SB 2263, the Legislature amended section 5471 to add the word “water” in several places. Before this amendment, section 5471 authorized an entity to impose “sewer standby or immediate availability charges.” The 1988 amendment extended this authorization by also authorizing an entity to impose water “standby or immediate availability charges” and by permitting the revenues from those charges to be used to pay for services and facilities furnished “in connection with its water…system.” (RJN Exh. Q.) SB 2263 did not amend the definition of “entity” discussed above. Petitioners cite several analyses of the bill that, on the whole, support a conclusion that the Legislature intended the amendment to clarify that a local agency that provides sanitation and sewer facilities may also levy water standby or immediate availability charges that may be used for operations or maintenance of water, sanitation, or sewerage systems. (Oppo. 16:7-17, citing Pet. RJN Exh. R at 107, Exh. S at 109, Exh. T at 112, Exh. U at 115, and Exh. V at 117.)

In 2007 (SB 444), the Legislature amended numerous statutes throughout the California Codes that authorized public agencies to impose standby charges, including section 5471. (Pet. RJN Exh. W at 213-244.) The purpose of the amendments was to bring the various standby charge statutes into conformance with the notice, protest, and hearing requirements for levying new standby charges under Prop 218, which had taken effect 11 years earlier. (Pet. RJN Exh. X at 246-247; Exh. Y at 249-250.)

The legislative history is not definitive as to whether the Legislature intended, by the reference to “water system” in section 5471(a), to include water delivery charges.

Respondent cites three cases that have discussed or interpreted section 5472. (OB 6-10, discussing Padilla v. City of San Jose (2022) 78 Cal.App.5th 1073, 1079; Los Altos Golf & Country Club v. County of Santa Clara (2008) 165 Cal.App.4th 198, 207; and Richmond v. Shasta Community Services Dist. (2004) 32 Cal.4th 409.)

None of these cases have considered whether a water delivery charge of a water utility such as LADWP is subject to section 5472. For that reason alone, Respondent’s reliance on these cases is not persuasive. “An opinion is not authority for propositions not considered.’” (People v. Knoller (2007) 41 Cal.4th 139, 154-55.)

Additionally, all three cases relied upon by Respondent are distinguishable and, in some respects, support Petitioners’ position. In Los Altos, supra, the Court of Appeal considered an action to recover fees paid for sewer service provided by the City. The Court stated that “Article 4, Chapter 6, Part 3, Division 5 of the Health and Safety Code, … contains general provisions on sewers, including sections 5472 …. Section 5472 … specifically addresses challenges to sewer charges.” (165 Cal.App.4th at 204.) The Court’s analysis otherwise does not provide insight into whether a water delivery charge of a water utility could be subject to section 5472.

However, in Padilla, supra, the Court of Appeal held that section 5472 applied to garbage charges based on an interpretation of the plain language consistent with that discussed above. Specifically, the Court stated:

By its plain language, the article where section 5472 appears (Article 4 of the Health and Safety Code, regulating “sanitation and sewerage systems”) applies to garbage collection. Article 4 is found in Division 5 of the Health and Safety Code, entitled “Sanitation.” A dictionary definition of sanitation is the “prevention of disease by maintenance of sanitary conditions (as by removal of sewage and trash).” (Merriam-Webster Dictionary online; https://perma.cc/6CQM-QUJU [as of May 13, 2022].) The text of each relevant Health and Safety Code section shows they apply to municipal garbage collection charges. (Thompson v. Ioane (2017) 11 Cal.App.5th 1180, 1199, 218 Cal.Rptr.3d 501 [words of a statute are the most reliable indicator of legislative intent].) Section 5472 requires payment under protest before challenging “fees, rates, tolls, rentals or other charges [ ] fixed pursuant to this article.” Section 5470 in Article 4 defines “[r]ates or [c]harges” to include garbage collection: “ ‘Rates or charges’ shall mean fees, tolls, rates, rentals, or other charges for services and facilities furnished by an entity in connection with its sanitation or sewerage systems, including garbage and refuse collection.” (§ 5470, subd. (f).) The Legislature was clear that the charges described by section 5472 include those for garbage collection.

In Richmond, the California Supreme Court discussed section 5471’s application to a community services district that provides water service. The Court held section 5471 did not apply there because a community services district organized solely for water service is not an “entity” as section 5470 defines it. Specifically, the Court stated:

Health and Safety Code section 5471 is part of article 4 (“Sanitation and Sewerage Systems”) of chapter 6 (“General Provisions with Respect to Sewers”) of part 3 (“Community Facilities”) of division 5 (“Sanitation”) of the Health and Safety Code….

Health and Safety Code section 5471 does not apply to the District because it is not an “entity” within the meaning of this provision. Health and Safety Code section 5470 states that “ ‘[e]ntity’ means and includes counties, cities and counties, cities, sanitary districts, county sanitation districts, sewer maintenance districts, and other public corporations and districts authorized to acquire, construct, maintain and operate sanitary sewers and sewerage systems.” The District is a public agency organized as a community services district under the Community Services District Law (Gov.Code, § 61000 et seq.) to provide water service. Nothing in the record indicates it is authorized *430 to construct, maintain, or operate sewers or sewerage systems.

Padilla and Richmond support an interpretation of section 5470-5742 in which the definitions of “entity” and “rates and charges,” and also the statutory headings, show intent for the statutes to apply to entities “authorized to acquire, construct, maintain and operate sanitary sewers and sewerage systems.” These cases do not suggest that section 5472 applies to water delivery charges of a water utility, such as LADWP, that does not acquire, construct, maintain, and operate sanitary sewers and sewerage systems. Notably, Respondent has not cited a single case that has applied section 5472 to water delivery charges. In any event, the court need to definitely determine whether Section 5471 and 5472 may ever apply to water delivery charges. As discussed below, the charges at issue were not imposed pursuant to these provisions.

Even if Section 5471 Could be Interpreted to Apply to Water Delivery Charges, Respondent Has Not Fixed the LISA Charge Pursuant to Article 4

The pay under protest provisions of section 5472 only apply to “fees, rates, tolls, rentals or other charges fixed pursuant to this article.” Even if water delivery charges could fall within the ambit of Section 5472, Respondent does not persuade the court that the water delivery charges at issue were “fixed” pursuant to Article 4 “Sanitation and Sewerage Charges.” Respondent provides no evidence it ever invoked this Article as authority to impose water delivery fees. Neither the Resolution adopted by the Board of Water and Power Commissioners nor the ordinance approving those rates mention Health and Safety Code Article 4. The amendments to section 5471 adding authority to impose fees “in connection with a “water system” were adopted in 1988. Clearly, Respondent has been charging water delivery fees since well before 1988. Respondent provides no evidence that it changed the basis upon which it charged those fees after 1988, to rely on Article 4, Sanitation and Sewer Systems, rather than the authority upon which it previously relied to impose those charges. The authority to fix water rates for delivery of water to the City’s inhabitant was already well-established. (See, e.g., Los Angeles City Water Co. v. Los Angeles (1898) 88 F. 720).

Moreover, DWP’s administrative practice is consistent with a determination that it was not fixing water delivery rates pursuant to Article 4 Sanitation and Sewerage Charges.

“It is a well-established rule of statutory construction that ‘[t]he contemporaneous and practical construction of a statute by those whose duty it is to carry it into effect, while not controlling, is always given great respect. And a contemporaneous interpretation long acquiesced in by all persons who could possibly have an interest in the matter, has been held to be sufficient to justify a court in resolving any doubt it might have as to the meaning of ambiguous language employed by the legislature, in favor of sustaining such long unquestioned interpretation.” (Amalgamated Transit Union, Local 276 v. San Joaquin Regional Transit Dist. (2019) 36 Cal.App.5th 1, 9-10.)

As discussed, the reference to “water systems” has been in section 5471 since 1988. Despite that, LADWP cites no evidence that it has ever informed its customers of the pay under protest requirement of section 5472. Rule 10 of LADWP’s Rules Governing Water and Electric Service, which Respondent cites, does not mention this pay under protest requirement. (OB 13-14, citing Resp. RJN Exh. 5.) Further, in its responses to special interrogatories, Respondent confirmed it has not notified water customers of the existence of the “pay under protest” requirement. (Rottinghaus Decl. Exh. EE at 34-37, Exh. FF at 49-52.) Documents published on LADWPs’ website entitled “Filing a Claim with LADWP FAQ” and a claim form entitled “Claim to Dept. of Water & Power” also lack any mention of the pay under protest requirement. (Id. Exh. CC 5-13; Exh. DD at 27-28.) If the pay under protest requirement applied to water delivery charges of LADWP, it is noteworthy that LADWP has never communicated such fact to its customers. Respondent also cites no evidence that it has ever, before this writ petition, interpreted section 5472 to apply to water delivery charges such as LISA. This administrative practice undermines the position taken by Respondent in this case.

Based on the foregoing, the court is not persuaded LISA is a “rate or charge” subject to the pay under protest requirement of section 5472.

The Government Claims Act Applies, Limits Petitioners’ Damages to One Year Before Petitioners’ Claim was Filed, and Authorizes Class-Wide Relief

In the alternative, Respondent contends that “if this Court determines that Section 5472 does not apply to LADWP’s Schedule A water rates, any refund awarded to Plaintiffs can extend back only to August 22, 2017,” one year prior to the date Petitioners filed their government claim for class-wide damages. (OB 14-15.) In the alternative to a constitutional argument, discussed below, Petitioners also argue that the Government Claims Act (“GCA”) applies to their claim for refund. (Oppo. 12.) The court agrees with both parties that the GCA applies.

“The Government Claims Act (Act) ‘established a standardized procedure for bringing claims against local governmental entities.’ [Citations.] The purpose of the Act ‘is to provide the public entity sufficient information to enable it to adequately investigate claims and to settle them, if appropriate, without the expense of litigation.’ [Citation.]….[¶] According to the Act, ‘all claims for money or damages against local public entities’ are to be presented ‘in accordance with Chapter 1 (commencing with Section 900) and Chapter 2 (commencing with Section 910),’ except as provided in section 905. (§ 905.) One of the exceptions in section 905 is for ‘[c]laims under the Revenue and Taxation Code or other statute prescribing procedures for the refund ... of any tax ... or any portion thereof ....’” (McWilliams v. City of Long Beach (2013) 56 Cal.4th 613, 618-619.)

In Ardon v. City of Los Angeles (2011) 52 Cal.4th 241, our Supreme Court held that claims for tax refunds against a local government entity, including class claims, are permitted by section 910 “in the absence of a specific tax refund procedure set forth in an applicable governing claims statute.” (Id. at 253.) Here, Respondent argues that section 5472 applies a “specific tax refund procedure” for Petitioners’ claims. However, the court has rejected that contention.

Since no other statutory refund procedure applies, Petitioners’ claim for monetary relief for violations of Proposition 218 is subject to the GCA. The Court of Appeal recently reached that exact conclusion in Plata v. City of San Jose (2022) 289 Cal.App.5th 736. As here, Plata involved a plaintiff class that sought a refund of water charges on the ground the charges violated Prop 218. (Id. at 740-744.) The trial court found the city’s tiered water rates violated Prop 218, Art. 13D §6(b). (Id. at 743.) On appeal, the city argued the plaintiffs’ action was barred because plaintiffs failed to comply with the GCA. (Id. at 747.) The Court agreed and reversed the trial court on that basis. (Id. at 747-748.) The Court specifically rejected the plaintiffs’ argument that the GCA did not apply to its claim, stating:

The Platas could not bring a suit “for money or damages” against the City without properly presenting a claim first. (See Gov. Code, §§ 905, 945.4.) [Footnote 5: The Platas refuse to concede the GCA applies to the dispute, but it seems clear to us. While the trial court ultimately determined they could not recover damages under Proposition 218's scheme, the fact remains that their prayer for relief requested general and special damages. By the Platas' own framing of the dispute from the beginning, the GCA applied. Had the trial court decided damages were recoverable, surely the Platas would have accepted them.] The City and its amicus curiae argue none of the Platas' government claims identify or “fairly describe” the tiered rate structure as an issue. After careful consideration, we agree. (Id. at 748, fn. 5.)

Thus, as Petitioners acknowledge, “Plata held that the GCA applied to a claim for a refund of water charges that is based on a violation of Prop 218, Cal. Const., Art. 13D §6(b).” (Oppo. 13.) Plata is directly on point and supports applying the GCA here as well.

Under the GCA, any claim against a public entity related to a cause of action that is not for personal injury or property damage must be presented “not later than one year after the accrual of the cause of action.” (Gov. Code § 911.2(a).) Petitioners’ claim for refund accrued each time an unlawful LISA charge was paid and collected.

It is undisputed that Petitioners filed their government claim on August 22, 2018, seeking a refund for the LISA charge on a class-wide basis. (FAP Exh. B; see OB 14:25-27.) Thus, as Petitioners pleaded in the petition, they are entitled to a monetary refund, on a class wide basis, for the unlawful LISA charges “paid from and after one year prior to the date of the government claim, August 22, 2017.” (FAP ¶ 46; see also Plata, supra at 752 [barring recovery for alleged violations of Proposition 218 that occurred more than one year before the filing of the government claim].)

Based on the foregoing, the GCA applies to Petitioners’ claim for refund, on a class wide basis, of the unlawful LISA charges. Because Petitioners filed their government claim on August 22, 2018, they are limited to a refund of the LISA charges on a class wide basis dating back to August 22, 2017.

Proposition 218, the Omnibus Implementation Act, and CCP Section 1085 Do Not Supersede the GCA or Exempt Petitioners’ Claim from the GCA

Petitioners argue that the court must “issue a writ of mandamus ordering a refund of all unconstitutionally taken funds” from April 2016, when Respondent first imposed LISA, and that no statute of limitations applies. (Oppo. 7-8.) Petitioners assert that LISA is an “unconstitutional taking” that violates Proposition 218 and that “an order directing restitution of all sums improperly collected is appropriate relief incidental to the writ of mandate prohibiting the collection of LISA charges.” (Ibid.) The court does not agree.

As discussed above, Petitioners’ claim for money is subject to the Government Claims Act and limited to a refund of LISA charges extending back to August 22, 2017. Nothing in Proposition 218 or the Omnibus Implementation Act supports a contrary conclusion.

While Proposition 218 refers to “legal actions,” it does not mention a refund or a damages remedy. (Cal. Const., Art. XIII D, §§ 4(f), 6(b)(5).) The Omnibus Implementation Act also does not provide or imply a refund remedy. (Gov. Code §§ 53750, et seq.) Petitioners fail to cite any statute, constitutional provision, or published decision supporting their contention that Proposition 218 or the Omnibus Implementation Act impliedly repealed the Government Claims Act as applied to refunds for unlawful taxes or fees collected by a local government entity. Petitioners’ argument of implied preemption, without any textual support, is contrary to the rule that “courts are required to try to harmonize constitutional language with that of existing statutes if possible.” (Citizens Assn. of Sunset Beach v. Orange County Local Agency Formation Com. (2012) 209 Cal.App.4th 1182, 1192.)

Petitioners argue, in effect, that no statute of limitations applies to their Proposition 218 claim for damages. That contention has been rejected by the Court of Appeal. In Barratt American, Inc. v. City of San Diego (2004) 117 Cal.App.4th 809, the plaintiff argued that Proposition 218 “generally abolishes any statute of limitations.” (Barratt, supra, 117 Cal.App.4th at 816.) The Court disagreed, stating:

Neither Proposition 218 nor the Omnibus Act mention section 329.5 or any other statute setting forth a limitations period, nor do they prescribe any period by which a legal challenge to an assessment levied under its provisions must be made. While Proposition 218 expressly references the local agency's burden of proof in any legal challenge contesting the validity of an assessment, nothing in the constitutional provisions it added addresses the timing of such challenges….. Proposition 218 thus conflicts with and renders unconstitutional contradictory procedures or process leading to the adoption or levy of an assessment falling within its ambit. It does not conflict with process or procedures relating to the timing of legal challenges to such an assessment.

While Petitioners point out that Barratt did not decide the plaintiffs’ preemption argument, the Court’s published decision nonetheless supports a conclusion that Proposition 218 does not supersede statutory limitations periods, including the GCA. (See Sur-Reply 8.)

Petitioners also fail to show that the law of traditional mandate exempts their claim for refund from the GCA. (See Oppo. 7-8; Sur-Reply 6-8 and 16-17.) The Court of Appeal has already held that the GCA applies to claims for refund under Proposition 218, as discussed above. (Plata v. City of San Jose (2022) 289 Cal.App.5th 736, 748, fn. 5.) The court is bound by that published appellate authority.

Nor do Petitioners prove that LISA was an unconstitutional taking or that, even if it was, that their claim for damages is exempt from the Government Claims Act. Petitioners cite no authority that supports that position with respect to a water delivery charge similar to LISA. (See e.g. Oppo. 8:24-27, citing Escamilla v. Department of Corrections & Rehabilitation (2006) 141 Cal.App.4th 498, 512 [petition for writ of habeas corpus and return of personal property not subject to GCA].)

Petitioners cite authorities in their sur-reply that were not raised in their opposition brief. The court is not persuaded by Atchinson or Ward, which are hundred-year-old Supreme Court cases, did not apply California law, and are inapposite to the legal questions presented here. “An opinion is not authority for propositions not considered.’” (People v. Knoller (2007) 41 Cal.4th 139, 154-55.)

Based on the foregoing, the court rejects Petitioners’ argument that Proposition 218, the Omnibus Implementation Act, or other law exempt their claim for refund from the GCA.

Respondent contends that Petitioners’ pre-judgment interest is limited by Civil Code section 3287(c), which provides in pertinent part: “Unless another statute provides a different interest rate, in a tax or fee claim against a public entity that results in a judgment against the public entity, interest shall accrue at a rate equal to the weekly average one year constant maturity United States Treasury yield, but shall not exceed 7 percent per annum.” (OB 16.)

The court agrees. Petitioners have not identified any other statute that “provides a different interest rate.” Section 3287(c) expressly applies to “a tax or fee claim against a public entity,” which is the exact claim Petitioners have brought. Accordingly, section 3287(c) clearly controls.

Petitioners’ arguments to the contrary are not persuasive. (Oppo. 20; Sur-Reply 15-18.) Macy’s Dept. Stores, Inc. v. City and County of San Francisco (2006) 143 Cal.App.4th 1444 predates the pertinent amendment to section 3287(c), which was enacted in 2013. (See generally City of Clovis v. County of Fresno (2014) 222 Cal.App.4th 1469, 1475.) Macy’s is no longer good law to the extent it applied a version of section 3287 that has been superseded by statute.

Petitioners argue that “California Constitution Article XV, Section 1 require[s] the payment of interest on tax refunds at a rate of seven percent.” (Oppo. 20.) However, Article XV, Section 1 states that “[i]n the absence of the setting of such rate by the Legislature, the rate of interest on any judgment rendered in any court of the State shall be 7 percent per annum.” (bold italics added.) Here, in section 3287(c), the Legislature has specifically set the rate of interest that applies to Petitioners’ claim for refund of fees paid to a public entity. Accordingly, Article XV, Section 1 also supports Respondent’s position that section 3287(c) controls.

LISA is not a “rate or charge” subject to the pay under protest requirement of Health and Safety section 5472. Accordingly, Petitioners were not required to comply with section 5472 to seek monetary relief in this writ action.

The Government Claims Act applies to Petitioners’ claim for refund, on a class wide basis, of the unlawful LISA charges. Because Petitioners filed their government claim on August 22, 2018, they are limited to a refund of the LISA charges on a class wide basis dating back to August 22, 2017.

The court rejects Petitioners’ argument that Proposition 218, the Omnibus Implementation Act, or other law exempt their claim for refund from the GCA.

The court will apply the rate of interest set by the Legislature in section 3287(c).

[1] At the time of its enactment in 1945, current §5471 was designated as §5470; it was renumbered as §5471 in 1953. (See Bereczky-Anderson Decl. ¶ 4.)